Smaller, independent hospitals across the nation have increasingly sought partnerships with larger hospitals in recent years, a trend largely driven by financial challenges.

For Highlands-Cashiers Hospitals, the latest hospital in the region to jump on board with Mission Hospital in Asheville, cost savings were certainly a large motivator, although not the only one. While Highlands-Cashiers Hospital loses money on operations every year, that doesn’t mean it is in the red.

“Our hospital has always had operating losses, but because of the generosity of philanthropy, we have always been able to cover that and grow our portfolio over the years,” said CEO Craig James.

The Highlands and Cashiers area is known for its affluent and wealthy population of retirees and second-home owners. Their charitable giving has been a backbone for the hospital.

While many only visit the area for part of the year, they want to ensure there is a viable, quality hospital in their adopted mountain home when they are in town.

“There has been a long standing desire to have local access to health care,” James said. “The driving time to the next nearest hospital is 45 minutes.”

A testament to its success, Highlands-Cashiers Hospital has more medical service lines and specialists than you typically find in a community of its size.

There is no hospital at all in either Graham or Clay counties, for example, both of which have larger populations than the Highlands-Cashiers area.

Highlands-Cashiers Hospital has seemingly carved out a niche serving a fairly limited geographic area. Again, that’s something James attributes to “uniqueness of our community and the generosity and support of philanthropy.”

Highlands-Cashiers Hospital is weighted heavily toward outpatient services — which account for 80 percent of its revenue, James said. Outpatients services are generally more elective, from scheduled surgeries to physical therapy to breast cancer screening. For most hospitals, outpatient revenue is around 50 percent.

The much higher percentage for Highlands-Cashiers shows patients there are choosing their local hospital when it offers what they need.

When it comes to in-patient services, however, Highlands-Cashiers’ only captures 30 percent of the business from its own market area. It’s simply not their niche. The vast majority of patients needing in-patient care go outside the area.

Primarily, however, that’s because Highlands-Cashiers Hospital doesn’t offer a full suite of in-patient services locally. It doesn’t deliver babies, for example, or have an intensive care unit.

If Highlands-Cashiers is unique for simply having a hospital at all for a community its size, it is even more unique in the range of service it provides — such as general surgery or orthopedics.

On paper, the population of Highlands and Cashiers might not seem like enough to support the range of service lines and number of physicians there. But consider the robust second-home market during the past two decades — a market that leans heavily toward seniors who need more health care — and it becomes more apparent where Highlands-Cashiers Hospital gets its demand.

Still, Highlands-Cashiers Hospital has had to be laser-focused on patient satisfaction.

“Not everything is going to be provided at a small hospital, but what you do, do it well,” James said.

It is particularly true given the larger percentage of its business that is out-patient — 80 percent of its revenue — and in many cases means the patient had the flexibility of shopping around to other hospitals.

“Our patient satisfaction rate is extremely high. Our patients appreciate the compassion of individualized service they receive here,” said Robin Taylor, the director of the hospital’s non-profit foundation.